Champion v Rohrt [2016] VSCA 215

3 The applicant seeks leave to appeal against the Tribunal's orders. He contends that the Tribunal lacked jurisdiction in the dispute and that, in any event, its decision as to costs was affected by errors of law. For the reasons that follow, the Tribunal had jurisdiction. However, the applicant's contentions as to the manner in which it exercised its discretion as to costs should be upheld and those orders should be set aside.

4 It is necessary to set out in a little detail the way in which the dispute developed.

5 The respondent was appointed the liquidator of ARBD by an order of the Supreme Court dated 24 September 2014.

6 On 25 September 2014 the respondent wrote to the applicant advising him of his appointment and noting that the applicant acted on behalf of ARBD. The letter relevantly continued:

1. All matters in which you have instructions from the company so that I may assess the action to be taken in respect of those matters.

2. All matters in which you previously had instructions from the company.

3. Whether you hold or retain any books, records or documents that belong to the company in respect of those matters, including any electronic files or documents.

4. Whether you hold any monies on behalf of or in trust for the company and, if so, the amount, together with details of all trust account transactions effected by you on behalf of the company, including any transit monies or any controlled monies held by third parties on trust for the company whether alone or jointly.

7 The applicant and the respondent discussed the liquidation on 25 September 2014 and the applicant told the respondent that he would have his files in respect of ARBD copied within a couple of days and that he would make those files available to the respondent. The applicant indicated to the respondent that he would provide the files without requiring service of a formal notice.

8 The applicant did not produce the files in the days after the meeting of 25 September 2014. The respondent then wrote to the applicant on 8 October 2014 attaching a formal notice pursuant to s 530B of the Corporations Act 2001 (Cth) ('Corporations Act') ('the notice'). The notice stated that the applicant was required to produce by 17 October 2014:

The following books and records of the company, to the extent they are in your possession and/or control namely:

(a) All books, records and documentation, including any electronic files and documents formerly requested in my letter to your office dated 25 September 2014. ...

(b) All Financial Statements, including but not limited to all Profit and Loss accounts, Balance Sheets, Depreciation Schedules and Taxation Returns.

(e) Cash Records, including not limited to all Cash Receipts Journals, Bank Deposits Books, Cash Payments Journal, Cheque Butts and Petty Cash Books.

(f) Bank Account Statements and Bank Reconciliations.

(g) Sales/Debtor Records, including but not limited to all Sales Journals, Debtors Ledger, Lists of Debtors, Invoices & Statements issued and Delivery Dockets.

(h) Business Activity or Instalment Activity statements.

(l) Creditor Records, including but not limited to Invoices and Statements received and paid, Creditors Ledger and Unpaid Invoices.

(o) The following Registers, namely: Members, Options, Debenture Holders, Prescribed Interests, Charges, Futures Licensees, Holders of Proper Authorities and Unclaimed Property.

(p) Minutes of Meetings of Directors and/or Members.

(q) The following Deeds namely: All Trust Deeds, of Debenture and any Contract or Agreement, concerning or relating to the company's affairs.

9 It is immediately apparent that, apart from the documents alluded to in para (a), the notice was in a standard form, calculated to require production of the financial and business records of the company rather than the contents of a solicitor's file. It will be necessary to return to the meaning of para (a) of the notice.

10 The applicant failed to deliver up any documents by the specified date. The respondent could, in the circumstances, have sought a mandatory injunction under s 1324 of the Corporations Act. Instead, on 29 October 2014 he made a complaint to the Legal Services Commissioner ('the Commissioner'). The complaint was said to be based on two 'related but nevertheless distinct matters', being the failure of the applicant to deliver up the property of ARBD and his failure to deliver possession of its books and records. The complaint identified the relevant property of ARBD as the legal files of documents of ARBD in relation to legal matters in which the applicant had acted for ARBD. It described the failure to deliver up ARBD's books and records as a contravention of the Corporations Act. A copy of the notice, among other documents and correspondence, was enclosed with the complaint.

11 On 1 December 2014, the applicant delivered boxes of documents to the respondent. On 2 December 2014, the respondent sent a letter to the applicant alleging wide-ranging deficiencies in the production of documents. The letter asked about certain files and attachments to emails which had not been produced. It also sought documents held by the applicant by virtue of his firm being the registered office of ARBD, including correspondence sent to the company and trust account reconciliations. The letter sought a response by 8 December 2014.

12 On 17 December 2014, the applicant provided trust account statements to the respondent.

13 On 19 March 2015, the Commissioner sent a letter to the applicant stating that the applicant and the respondent had not been able to resolve their dispute within a reasonable time and that therefore the applicant was entitled to commence an application before the Tribunal pursuant to s 4.3.15 of the LPA.

14 Section 4.3.15(1) relevantly provided that a party to a civil dispute that was the subject of a civil complaint may apply to the Tribunal for the resolution of that dispute if that party had received notice from the Commissioner, relevantly under s 4.3.7. Section 4.3.7 provided for the Commissioner to give notice that the civil dispute could not be resolved by the Commissioner.

15 The respondent lodged an application with the Tribunal on 20 May 2015. In that application, he sought:

An order under section 4.3.17 of the Legal Profession Act 2004 that the [applicant] produce to the [respondent] the books and records listed at paragraph 2 of the Notice dated 8 October 2014 sent to the [applicant] pursuant to section 530B of the Corporations Act 2001.

16 Under the heading 'Reason for application', the respondent referred to the communications which had passed between the parties. He described the notice and the applicant's failure to produce the books and records sought. He described the letter of 25 September 2014 as having sought information. The respondent did not refer to any request for property of ARBD. However, the 'reasons' also stated:

I seek orders requiring the [applicant] to produce to me the material demanded within the section 530B notice that he has not produced as well as all material in the [applicant's] possession relevant to the company.

17 On 3 July 2015, following a directions hearing, the Tribunal ordered the respondent to file and serve by 10 July 2015 a more specific version of his letter of 2 December 2014, including particulars of four categories of document. It further ordered that the applicant file and serve his response in relation to the documents still sought by the respondent, including an affidavit as to the status of the documents still in dispute, by 7 August 2015.

18 On 27 July 2015, the respondent filed and served a letter ('the 27 July letter'). Relevantly, it sought production of the following documents, to the extent that they were in the possession and/or control of the applicant:

(a) a full accounting of the proceeds of sale of the [ARBD] property at 8 Peppermint Grove, Taylors Hill, including a reconciliation of the account sales of the vendor's real estate agent and a reconciliation of the surplus funds paid upon settlement;

(b) all documents in relation to your dealing with the sum/s of:

• (i) $7,449; and/or
• (ii) $165,514.54; and/or
• (iii) any other sum,

demanded, requested and/or received by you at settlement at or in respect of 8 Peppermint Grove, Taylors Hill;

(c) a full accounting of your costs and disbursements rendered for all matters wherein you acted for the company, including copies of the bills of costs and disbursements;

(d) copies of any and all costs agreements, legal practice costs, compliance statements and collateral documents relating thereto and passing between you and the company in respect thereof;

(e) copies of all documents securing your legal fees and disbursements for legal matters for the company, including collateral documents relating thereto and passing between you and the company in respect thereof;

(f) copies of all of your statements detailing all trust account transactions in company matters wherein you acted;

(g) your file of documents in relation to Supreme Court of Victoria proceeding SCI 2013 05925 [ARBD] v Australia's Residential Builder (In Liquidation) Pty Ltd, including all instructions, communications, advices, memorandums, briefs and files;

(h) your file of documents in relation to County Court of Victoria proceeding CI-13-05707 Australia's Residential Builder (In Liquidation) Pty Ltd v [ARBD], including all instructions, communications, advices, memorandums, briefs and files;

(i) electronic copies of all of your communications to and from the company, its officers, agents and servants, including copies of all attachments to those electronic communications;

(j) copies of all communications relating to your firm's consent to act as the registered office of the company, including the documents provided to your office at the commencement of its period of record as the registered office of the company;

(k) copies of all trading records of the company during the period from the commencement of your office as the principal place of business of the company;

(l) the original/s of any charge or instrument in writing to secure your fees together with any advice, recommendation or warning to the company to obtain independent legal advice which accompanied or was given in respect of such charge or instrument and any acknowledgment or communication from the company in respect of same and any such third party legal advice;

(m) the original secretarial file of the company; and

(n) the original accounts of and copies of the tax returns of the company.

19 On 13 August 2015, the Tribunal conducted a compulsory conference. The conference did not result in the resolution of the dispute.

20 On 30 September 2015, the applicant filed and served an affidavit responding to the 27 July letter. In respect of many requests and categories of documents, the applicant claimed that the requests related to documents that had not been sought prior to the commencement of the proceeding. In every case, however, the applicant responded to the request. His responses were of two general kinds:

(a) The applicant stated that some documents which existed were not the property of ARBD. This included his own hard copies of documents sent to ARBD, his own financial and other records, documents securing the applicant's legal fees and electronic copies of electronic communications to and from ARBD.

(b) In some cases, the applicant said that he held no documents, or no further documents, of the kind requested.

21 On 13 October 2015, the matter was heard before the Tribunal. Counsel for the respondent opened the matter by reference to the applicant's failure to comply with the s 530B notice. Counsel for the applicant began by briefly contending that the Tribunal lacked jurisdiction because there was no 'civil complaint' within the meaning of the LPA. The Tribunal did not rule on jurisdiction at that point and the matter proceeded. Before the luncheon adjournment, the Tribunal indicated that it had great difficulty understanding the basis for the applicant's objections to producing the documents and suggested that he carefully consider his position. After the adjournment, counsel for the applicant informed the Tribunal of concessions the applicant was prepared to make. The respondent wished the matter to be adjourned so that he could examine the documents that had been agreed to be produced. In the course of the ensuing discussion, the Tribunal stated that there had been no basis for the objection to jurisdiction, which clearly existed because the respondent as liquidator stood in the shoes of ARBD in maintaining a civil dispute with its solicitor.

22 Consent orders were then made requiring the applicant to provide certain categories of documents to the respondent and adjourning the proceeding until 9 November 2015. The documents in question reflected paras (c), (e) and (i) as described above in the 27 July letter.

23 Some documents were provided prior to 9 November 2015 and, on that date, further evidence was given by the respondent as to the provision of documents to him totalling some 191 pages together with 761 emails. Evidence was given of redactions in the documents provided and some discrepancies and unexplained matters. The proceeding was further adjourned until 18 November 2015. By that time, the applicant had provided about 40 further pages of documents to the respondent.

24 On 18 November 2015, counsel for the respondent informed the Tribunal that no further documents were sought and submissions were made as to costs. The substantive dispute having been resolved, the Tribunal reserved its decision and written submissions on costs were thereafter provided.

25 On 25 November 2015, the Tribunal delivered its reasons and made orders awarding the respondent the costs of his application on an indemnity basis.[1] On the question of jurisdiction, the Tribunal reiterated that the respondent stood in the shoes of ARBD and s 530B was merely the mechanism by which he sought recovery of ARBD's documents from its legal practitioner. This was said to give rise to a civil dispute which could be determined by the Tribunal.

26 The Tribunal held that the applicant had failed to comply with the notice in material respects.[2] It proceeded to consider the question of costs by reference to s 109 of the Victorian Civil and Administrative Tribunal Act 1998 ('VCAT Act'), which relevantly provides:

(1) Subject to this Division, each party is to bear their own costs in the proceeding.

(2) At any time, the Tribunal may order that a party pay all or a specified part of the costs of another party in a proceeding.

(3) The Tribunal may make an order under subsection (2) only if satisfied that it is fair to do so, having regard to -

(a) whether a party has conducted the proceeding in a way that unnecessarily disadvantaged another party to the proceeding by conduct such as -

(i) failing to comply with an order or direction of the Tribunal without reasonable excuse;

(ii) failing to comply with this Act, the regulations, the rules or an enabling enactment;

(iii) asking for an adjournment as a result of (i) or (ii);

(v) attempting to deceive another party or the Tribunal;

(b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding;

(c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law;

(e) any other matter the Tribunal considers relevant.

27 The respondent relied on ss 109(3)(c), (d) and (e).

28 The Tribunal considered each of the objections made to production of documents in the 27 July letter to be spurious. The Tribunal set out its reasons:[3]

The obligation of the [applicant] to deliver the records of ARBD in his possession is unambiguous and unconditional. It did not require the [respondent] to particularise individual documents sought, other than by reference to the descriptive categories and transactions. The [respondent's] subsequent letters merely sought to identify the extent of the [applicant's] failure to comply and do not represent an extension of documents sought under the original Notice.

The [applicant's] second objection[4] is inexplicable. As stated by [respondent's] Counsel, the only documents which can be retained by a solicitor when acting for a client, are the solicitor's own file notes or similar aide memoires. The remaining documents are the property of the client.[5]

The [applicant's] third objection[6] fundamentally misconstrues the purpose of the s 530B Notice. As indicated in the evidence of Mr Caspaney, while a liquidator may assemble documents and information from a variety of sources, the liquidator is not armed with complete information in advance and cannot describe in any detail the nature of documents or the dates or their purpose or effect or other parties to such documents. Accordingly, it is not surprising that the broad descriptive categories may encompass documents which are not or no longer in the [applicant's] possession; or documents of which the [applicant] has no knowledge or, to his knowledge, do not exist. Clearly there is no obligation upon the [applicant] to produce such documents and to the extent that the Notice encompasses documents which the [applicant] cannot produce, does not reflect a defect in the Notice.

The [applicant] also submitted that the Tribunal had no jurisdiction to consider compliance with a Notice issued under the Corporations Law, for which the Supreme Court was the appropriate forum.

In my view, the s 530B Notice is merely the mechanism by which a liquidator, now standing in the shoes of the company, is authorised to demand recovery of the company's documents. In this instance, the [applicant], as a legal practitioner, continues to be subject to the [LPA], pursuant to which civil disputes may be determined by the Tribunal.

For all of the above reasons, I agree that the position maintained by the [applicant] was misconceived and without a tenable basis in fact or law.

29 The Tribunal therefore characterised the respondent's claim as very strong.[7] It further considered that there was no particular complexity in the content of the notice[8] and that there was no acceptable explanation for the applicant's objections or his 'inordinate delay in properly complying with it'.[9]

30 The Tribunal further considered that the applicant, as a legal practitioner, ought to have been aware of his obligation to comply with the notice and cooperated with the respondent, who was exercising his statutory duties.[10] The Tribunal continued:[11]

In my view, the further documents provided by the [applicant], following each of the hearings before the Tribunal, are testament to the [applicant's] unexplained failure to produce documents of ARBD in a timely manner. Furthermore, the information revealed in the documents do not on their face explain the manner in which the Charge in favour of the [applicant] was invoked on account of amounts payable by ARBD; or whether certain moneys received on account of ARDB were properly allocated on its behalf. While these matters ultimately may be adequately explained by the [applicant], the delay occasioned by the [applicant] has potentially prejudiced the proper administration of the liquidation of ARBD by the [respondent], for the benefit of outstanding creditors.

31 The Tribunal then listed various ways in which the respondent had incurred delay and additional costs, including the making of a civil complaint and the application to the Tribunal. On that basis, it was held to be fair that the applicant pay the respondent's costs of the proceeding.

32 The Tribunal considered that special circumstances existed to justify indemnity costs, namely that the applicant had not demonstrated any basis for delay or objecting to the production of documents and had shown a wilful disregard for known facts or clearly established law.

33 The applicant seeks leave to appeal on two grounds:[12]

1. The [Tribunal] erred in concluding that:
   • (a) the [Tribunal] had jurisdiction to hear the proceeding below and to make orders therein, under ss 4.3.15 and 4.3.17 of the [LPA], in circumstances where legal services had not been provided by the applicant to the respondent; and
   • (b) it was misconceived and without a tenable basis in fact and law for the applicant to have argued the contrary.
2. The [Tribunal] erred in concluding that:
   • (a) the various documents sought in paragraphs (a) to (n) of the [27 July letter] referred to at paragraph 21 of the Reasons were all the property of [ARBD];
   • (b) all of the documents sought by the 27 July letter were therefore properly the subject of the respondent's application to [the Tribunal]; and
   • (c) it was misconceived and without a tenable basis in fact or law for the applicant to have taken the objections which he did to production of those documents.

34 As indicated, the respondent purported to bring his application to the Tribunal pursuant to s 4.3.15 of the LPA, which provided for the making of applications 'for resolution of a civil dispute that is the subject of a civil complaint'. 'Civil complaint' was defined in s 4.2.2(1) as a complaint about conduct to which ch 4 of the LPA applied, to the extent that the complaint involves a civil dispute. The reference to conduct to which the LPA applied required a geographical connection which is not in issue in the present case. 'Civil dispute' was relevantly defined in s 4.2.2 as follows:

(2) A civil dispute is any one of the following -

(c) any other genuine dispute between a person and a law practice or an Australian legal practitioner arising out of, or in relation to, the provision of legal services to the person by the law practice or practitioner.

35 The applicant contends that he did not provide legal services to the respondent and that he therefore could not have a dispute with the respondent within the meaning of the definition of 'civil dispute'. He points to the fact that he acted for ARBD prior to its entry into liquidation, rather than for the liquidator. He notes that the application to the Tribunal was made by the liquidator personally, in his own name, rather than by ARBD, and that it alleged non-compliance by the applicant with a statutory notice issued by the respondent.

36 In oral argument, senior counsel for the applicant emphasised that the application to the Tribunal had sought an order that the applicant produce the documents listed in the notice. It was submitted that this defined the ambit of the issue before the Tribunal. The applicant submits that the Tribunal's observation that a s 530B notice is a 'mechanism by which a liquidator, now standing in the shoes of the company, is authorised to demand recovery of a company's documents' misapprehends the nature of such a notice. In particular, only a liquidator may issue a s 530B notice, pursuant to a specific statutory power, and the Corporations Act requires production of the books to the liquidator, rather than to the company itself.[13] Senior counsel drew attention to the fact that s 530B(1) provides that a person is not entitled, as against a liquidator, to retain possession of, or claim or enforce a lien on, books of the company. In that regard, the powers of a liquidator under s 530B are greater than those of the company and the liquidator cannot be said to stand in the company's shoes.

37 The respondent contends that the dispute was always about the applicant providing the documents of the company that were in his possession. The application to the Tribunal was made by the liquidator on behalf of the company and, likewise, the issuing of the s 530B notice was an action taken by the respondent in his capacity as liquidator to recover books and records of the company. Senior counsel submitted that the liquidator acts as the agent of the company and that the rights and powers conferred on the liquidator by the Corporations Act are to be exercised for and on behalf of the company.

38 The respondent submits that the jurisdictional argument made before the Tribunal was different to that now advanced, and that the only question raised had been that the Tribunal lacked jurisdiction to enforce compliance with a s 530B notice. He contends that the applicant's argument that the Tribunal lacked jurisdiction because the application was brought by the respondent in his own capacity could easily have been remedied, had the point been raised before the Tribunal; the application could have been amended to add ARBD as a party and specify that the respondent brought the application on behalf of ARBD.

39 Finally, the respondent relies on the consent orders dated 13 October 2015 (mentioned above) and observes that they were made without the applicant reserving his position as to the scope of the dispute before the Tribunal or its jurisdiction. In particular, it is submitted that the applicant should not, in light of the consent orders, be heard to argue that the dispute before the Tribunal was confined to the matters in the s 530B notice.

40 The applicant sought to characterise the dispute in the Tribunal as one about the enforcement of the s 530B notice. The foundation for that argument was the sentence in the application which states that the order sought was that the notice be complied with. However, that sentence must be read in the context of the statement later on the same page that orders were sought for production of the material demanded in the notice 'as well as all material in the [applicant's] possession relevant to the company'. The latter description is plainly broad enough to include documents in the applicant's possession belonging to the company.

41 It is also tolerably clear that, before the notice was sent, the respondent had asked the applicant to provide copies of his files. The letter of 25 September 2014 was in terms a request for information, rather than for the provision of company property. The request for provision of company property crystallised at the discussion between the parties on 25 September 2014, where the applicant stated that he would provide to the respondent the requested documents 'within a couple of days' and without the need for recourse to a s 530B notice. The parties' subsequent dealings make it clear that they were proceeding on the basis that the respondent had sought copies of such material as the letter asked about as was in the applicant's possession. The notice sought, perhaps not very clearly, to include that material within its scope, through para (a). Otherwise, para (a) would have had no content at all. Further, the covering letter to the notice made reference to the parties' discussion of 25 September 2014 and stated that the notice had been issued due to the applicant's failure to provide the documents, as promised at that meeting, within a reasonable time. And the letter to the Commissioner also made reference to the discussion of 25 September 2014, stating that during the discussion the respondent had 'stressed to [the applicant] the importance of [the respondent] securing the assets of [ARBD] without delay'.

42 When the respondent notified the Commissioner of the dispute, he distinguished two aspects and made it plain that compliance with the notice was only one issue, arguably giving it lesser precedence. Likewise, by the time that the Commissioner confirmed that the dispute had not been resolved, the further exchanges between the parties had not concentrated on the terms of the notice. The letter of 2 December 2014 made no reference to the notice.

43 It follows that the dispute which was brought to the Commissioner, and which was able to be made the subject of an application to the Tribunal by virtue of the Commissioner's written notice, involved a request by the respondent that the applicant provide to him the documents in his possession which were the property of the company. On a fair reading, the application to the Tribunal did not purport to narrow that dispute.

44 Accordingly, there was a dispute in which the liquidator of a company sought that company's documents from its solicitor. While the liquidator was appointed by the Court and exercises statutory powers, he also acts as the agent of the company. It is not necessary to decide whether, in exercising statutory powers, a liquidator acts as agent of the company. It may very much be doubted whether that is always the case.[14] In relation to s 530B, as the applicant submitted, the liquidator is empowered to demand documents not available to the company itself. This strongly suggests that, at least when acting under s 530B, a liquidator acts in his or her own capacity and not on behalf of the company. However, when a liquidator requests the company's property, or seeks information in relation to it, from a person possessing that property and having that information, he or she does so pursuant to no statutory power but simply in the capacity of a representative of the company itself.[15]

45 For these reasons, in our opinion, the dispute between the parties was one between a solicitor and a company for whom that solicitor had acted, which company was being represented in the dispute by its liquidator. The dispute concerned access to files created in connection with legal services performed by the solicitor for the company and therefore arose from the provision of those services. There was therefore a 'civil dispute' and also a 'civil complaint' within the meaning of the LPA and the Tribunal had jurisdiction to deal with the matter.

46 The first proposed ground of appeal therefore fails, to the extent that it asserts a lack of jurisdiction on the part of the Tribunal. It is not necessary to consider in this context, therefore, whether anything flowed from the manner in which the question of jurisdiction was raised by the applicant before the Tribunal or from the applicant's subsequent consent to orders that he produce documents and information. It should be noted, however, that had the Tribunal lacked jurisdiction, it could not acquire it by consent of the parties.[16] Equally, if jurisdiction was lacking, any absence of objection to jurisdiction would not avail the respondent, except perhaps in relation to costs, whether or not such an absence of jurisdiction could have been cured when the matter was in the Tribunal.

47 It is convenient to defer consideration of the first proposed ground, in so far as it contends that it was reasonable for the applicant to have raised the question of jurisdiction, until later in these reasons.

48 The second proposed ground of appeal contests the manner in which the Tribunal exercised its jurisdiction as to costs, by reference solely to the manner in which it treated the applicant's arguments in response to the 27 July letter. That is the matter under s 109(3)(c) of the VCAT Act. The applicant does not contest the Tribunal's findings under ss 109(3)(d) and (e). However, it may be noted that those findings did not materially affect the Tribunal's decision. In relation to para (d), the Tribunal stated that there was no complexity in the matter and no acceptable explanation for the applicant's objections. This only went to reinforce its conclusions under para (c). In relation to para (e), the Tribunal considered the fact that the applicant was a solicitor who ought to have cooperated with the respondent. Again, this served only to emphasise the significance of the Tribunal's findings about the 27 July letter. The Tribunal also relied on delay by the applicant more generally. No challenge was made to the Tribunal's findings in that regard. Conversely, nor was it suggested that those findings, of themselves, sustained the exercise of the Tribunal's discretion as to costs.

49 It is convenient then to turn to the manner in which the Tribunal treated the applicant's response to the 27 July letter.

50 As mentioned above, the 27 July letter requested production of various books and records of the company. Before the Tribunal, the applicant resisted production of those documents on three bases: that the documents were not sought in previous correspondence; that the documents were the property of the applicant, rather than ARBD; and that some of the documents either did not exist or were not in the possession of the applicant. Included in the latter category were some documents which the applicant had been asked, in effect, to create (such as trust account reconciliations).

51 The applicant contends that the Tribunal erred in characterising his objections as 'spurious'. The first objection, concerning the ambit of the dispute, has already been considered in relation to the first proposed ground of appeal. The applicant's submission that the 'civil dispute' that was the subject of the application to the Tribunal was limited to alleging non-compliance with the s 530B notice was rightly rejected. Nor was it correct, given that the respondent had requested the applicant's files generally, to object that the 27 July letter expanded the dispute because it travelled beyond matters sought in the 2 December 2014 letter. On the other hand, since the 27 July letter was sent in compliance with an order that the respondent send a more specific version of the 2 December 2014 letter, the earlier letter was a reference point upon which the parties could legitimately rely to circumscribe their dispute in the Tribunal. While it may not have been relevant to the Tribunal's jurisdiction, there was no reason why the 2 December 2014 letter could not be invoked in response to the 27 July letter.

52 In our opinion, the fact that the applicant had an obligation to deliver the documents of ARBD in his possession to the respondent does not make it spurious for the applicant to have asserted that the dispute in the Tribunal had become narrower, by virtue of the order for the respondent to write the 27 July letter. Therefore, the Tribunal was in error in stating that the respondent's letters did no more than identify the extent of the applicant's failure to comply with his general obligation. In the context of the matter before the Tribunal, those letters described the parameters of the dispute which remained between the parties.

53 In any event, the Tribunal did not acknowledge that, in each case where the applicant had raised an objection to the scope of the inquiry, he had also answered the inquiry under cover of that objection. This was a relevant consideration, without reference to which it would have been an error for the Tribunal to award costs by reason of the first objection having been taken.

54 In relation to the second objection, the applicant claims that the proposition that 'the only documents which can be retained by a solicitor when acting for a client, are the solicitor's own file notes or similar aide memoires'[17] substantially overstates the law. In fact, it is said, each document must be considered before it can be said whether it is the property of the solicitor or the client. Moreover, the majority of the documents in respect of which this objection was raised were the functional equivalent of aidesmémoire (for instance, the applicant's copies of emails, letters and bills sent to ARBD), and were therefore covered by the exception that the Tribunal enunciated. The other documents (such as the costs agreement between the applicant and ARBD, and the deed of charge securing amounts owing by ARBD to the applicant) were prepared for the applicant's protection or benefit and therefore were his property.

55 The respondent submits that even if some of the documents particularised in the 27 July letter were the property of the applicant, that does not mean that they were not 'books of the company'. 'Books' is defined inclusively in s 9 of the Corporations Act and is sufficiently wide to cover copies of emails, letters and bills sent to the company, the costs agreement between the applicant and ARBD, and the charge by which the applicant secured fees owing to him by ARBD. In any event, it could not be said that these documents were functionally equivalent to aides-mémoire.

56 In oral argument, the applicant submitted that the Tribunal had mistaken the effect of the New South Wales Court of Appeal's decision in Wentworth v De Montfort.[18] There was no general rule that the contents of a solicitor's file belonged to the client except for documents in the nature of aides-mémoire. These submissions should be accepted.

57 Wentworth v De Montfort concerned an application for declaratory relief as to which documents on a solicitor's file were, and which were not, the property of the client. Hope JA, with whom Samuels and Mahoney JJA agreed, reviewed various authorities and concluded as follows:[19]

A number of considerations can be discerned in these decisions and statements as being relevant in the determination of ownership. These include whether or not the client was charged for the creation of the document, and whether the solicitor created the document for his client's benefit and protection, or did so for his own benefit and protection. It is apparent that in many if not most cases a solicitor would have mixed reasons for creating a document. Thus if on his client's instructions he writes a letter of demand to a third party, it would be his duty to keep a copy of the letter, for the client may have to prove the sending of the letter and its contents, and the copy kept by the solicitor may be essential for this purpose. On the other hand the solicitor would want a copy for his own protection in order, for example, to be able to prove to his client that he had sent the letter of demand, and also for the purposes of making up a bill of costs. In such a case, the clients would be entitled to a copy of the letter and the solicitor would be entitled to charge him for it. On the other hand the solicitor would be entitled to keep a copy for his own records and absent some special agreement would not be entitled to charge the client for making that copy. Again if on his client's instructions the solicitor pays money to a third party and obtains a receipt, the receipt is obviously of benefit for the client for it is evidence that the third party has been paid. It is also evidence for the solicitor that he has carried out his client's instructions and would be needed by him if any questions as to payments out of his trust account were raised. Again in this case I should have thought that the client was entitled to the original receipt, but that the solicitor was entitled to retain a copy.

58 It is apparent from this passage that the question whether a client is entitled to a particular document on a solicitor's file will depend on a number of considerations, and in particular the purpose for which the document was created and whether the client was charged for its creation. Hope JA goes on to explain that it is not possible to give a single answer to the question whether a document consisting of notes of a telephone attendance on a person other than the client is the property of the solicitor or the client, without knowing the nature of the document or the relevant facts as to its creation. The same is said to apply to other records of personal attendances and correspondence.[20]

59 In light of these observations, it was, with respect, incorrect for the Tribunal to cite Wentworth v De Montfort as authority for the propositions that 'the only documents which can be retained by a solicitor when acting for a client, are the solicitor's own file notes or similar aide memoires' or that the 'remaining documents are the property of the client'.[21] The principles enunciated in Wentworth v De Montfort are wellestablished, as the authorities referred to in that case demonstrate. The question which documents on the applicant's files were properly the property of ARBD, and which were not, called for a more nuanced consideration. The 27 July letter ought to have been read in that light. The Tribunal erred in describing the objection as to ownership of documents as 'inexplicable'.[22]

60 As to the third objection, the applicant claims that the Tribunal misconceived the nature of the objection. Rather than suggesting that the notice was defective in asking for documents that did not exist, the applicant was rather stating that he was unable to produce certain documents, either because they did not exist or because he did not have possession of or control over them.

61 The respondent submits that the non-existence of a document, or the fact that the applicant did not have a document, was no answer to the issue before the Tribunal: namely, whether the request for production of the document was objectionable. For the reasons given in relation to the first objection, the request was a permissible one.

62 It is difficult to understand the way in which the Tribunal dealt with this class of objection. It accepted that the applicant was not bound to produce documents which did not exist, but stated that to ask for such documents did not reflect a defect in the notice. But the applicant was not objecting to request for documents on this basis; to the contrary, he was answering the request by stating that documents did not exist. He could not be criticised for doing so.

63 Finally, the applicant submits that, even if the argument as to jurisdiction fails, the Tribunal erred in describing the argument as 'misconceived and without a tenable basis in fact or law'[23] and concluding that the applicant had 'demonstrated a wilful disregard for known facts or clearly established law'.[24] In our opinion, there is substance in this submission. There is, as already noted, a strong argument that to the extent that the respondent was seeking an order that the applicant comply with the notice, he was doing so, not on behalf of the company, which had no entitlement to documents under s 530B, but on his own behalf. Failure to comply with the notice would, on that basis, not give rise to a 'civil dispute' within the meaning of the LPA. It must also be doubtful, on the same basis, whether the respondent, acting as agent of ARBD in seeking recovery of its property, could have obtained an order that the applicant provide documents to him, acting in his own right, under s 530B. As noted, these issues do not need to be resolved. But there was a tenable basis for contesting jurisdiction.

64 For the above reasons, the Tribunal's discretion as to costs miscarried. It was affected by legal error of the kind described in House v The King[25] and involved an error of law within the meaning of s 148 of the VCAT Act. The second proposed ground of appeal, and the first ground in so far as it relates to whether the jurisdiction point was arguable, should be upheld.

65 The respondent submitted that leave to appeal should in any event be refused. It was submitted that the liquidation would further be delayed if leave to appeal were to be granted or the appeal allowed. We disagree. Since the applicant has established legal error on the part of the Tribunal, with serious financial consequences for the applicant, leave to appeal should be granted and the orders of the Tribunal should be set aside.

66 Although in his application for leave to appeal the applicant sought his costs in the Tribunal, at the hearing he did not press for any such order in his favour, should the appeal be allowed. Instead, he sought an order that there be no order as to costs in the Tribunal, or that the question of costs be remitted to the Tribunal. However, as the respondent submitted, further delay would be caused if the matter were to be remitted to the Tribunal. The Court was provided with copies of the submissions as to costs made by both parties before the Tribunal, and is therefore in as good a position as the Tribunal to make its own assessment.

67 The applicant submitted that the merits of his objections were never ruled upon because the matter settled. Moreover, the matter settled on the basis that many of the claims in the 2 December 2014 letter and the 27 July letter were not proceeded with. The applicant contended that the issues in the proceeding were not made clear until 27 July 2015. He submitted that the factors in s 109 all go to some mischief in a party's conduct of a proceeding.

68 The respondent's submissions were substantially reflected in the decision of the Tribunal.

69 In our opinion, there is considerable force in the applicant's submissions. For the reasons already given, there was substance in the objections which the applicant made to the 27 July letter. The only other matter raised is the applicant's failure to provide documents in a timely manner. In that regard, the respondent did not rely on s 109(3)(b) of the VCAT Act, namely 'prolonging unreasonably the time taken to complete the proceeding', as a basis for seeking costs. To the extent that delay was relied on, it was the applicant's delay in complying with the notice. It may be assumed for present purposes, without deciding, that delay other than in relation to the proceeding itself may properly be taken into account under s 109.

70 While quite some time passed between 25 September 2014, when the applicant was first asked for documents, and the provision of those documents in and around November 2015, there was a series of exchanges between the parties as to what was sought. The various written requests made by the respondent were less than clear and, while it was apparent that the respondent sought all the books and records of the company, correspondence was duly entered into directed at identifying what this comprised. This eventually led to the dispute being confined to the matters in the 27 July letter, and the matter in the Tribunal was then settled when a narrower class of documents again, and a request for information, was agreed upon. Of course, boxes of documents had also been provided in December 2014.

71 In addition, the correspondence travelled beyond a simple request for documents. For example, in the 27 July letter, the respondent sought a full accounting of a particular transaction, together with supporting documents. This plainly introduced a new element to the dispute. In the Tribunal, the respondent unsuccessfully sought an order for payment by the applicant of $165,154.54 in respect of that transaction. Similarly, the relief ultimately obtained included an order that the applicant provide a full accounting of his costs and disbursements rendered when acting for ARBD (including copies of bills of costs and disbursements). This involved the creation, rather than the provision, of a document. In these respects, at least, the ambit of the dispute had become wider than the documents which the respondent had originally sought.

72 The delay in resolving the dispute is also, in part, traceable to the fact that the respondent chose to pursue the informal process with the Commissioner rather than take the matter directly to court. While the adoption of alternative dispute resolution processes is of course to be commended, it is difficult for the respondent now to assert that the applicant was guilty of remarkable delay, when there was a ready avenue for redress between October 2014 and the respondent's approach to the Tribunal in May 2015 for the respondent to enforce the applicant's compliance.

73 In the circumstances, while the applicant should have been aware of his obligations to provide documents to the respondent when requested to do so, especially after service of the notice, and his response to the request for documents was far too casual, the record does not reveal any conduct of the applicant in the proceeding of the kind that would ordinarily warrant a costs order. In so far as conduct prior to the application to the Tribunal may be taken into account, the content of what was requested evolved over time and in the end the proceeding yielded further documents only in a relatively narrow compass.

74 Ultimately, the dispute was narrowed to the matters in the 27 July letter. The applicant responded to that letter on grounds which do not of themselves attract an adverse exercise of the costs discretion, and the matter thereafter settled on a basis where neither side was entirely successful. In addition, considerable time was taken in the hearing by the respondent arguing that the applicant should pay the sum of $165,514.54 already referred to, including the leading of evidence as to that matter. The Tribunal decided that this claim could not properly be advanced in the proceeding. The respondent therefore failed in a significant aspect of the proceeding.

75 For the above reasons, taking into consideration the matters set out in s 109(3) of the VCAT Act, in our opinion the respondent has not made out a case for departing from the ordinary rule in the Tribunal that no costs order should be made.

76 Leave to appeal should be granted, the appeal should be allowed and the decision of the Tribunal set aside. In its place it should be ordered that there be no order as to the costs of the proceeding in the Tribunal.

[1] Rohrt v Champion [2015] VCAT 1875 ('Reasons').

[4] See [20(a)] above.

[5] Refer Wentworth v De Montfort & Ors (1988) 15 NSWLR 348.

[6] See [20(b)] above.

[12] The appeal lies to the Court of Appeal because the Tribunal was constituted by a Vice President: VCAT Act s 148(1)(a).

[13] See Corporations Act s 530B(4).

[14] See Sydlow Pty Ltd (in liq) v T G Kotselas Pty Ltd [1996] FCA 1384; (1996) 65 FCR 234, 238-9 (Tamberlin J); Bell v Amberday Pty Ltd (2001) 39 ACSR 25, 31 [22] (Austin J); Tanning Research Laboratories Inc v O'Brien (1987) 11 ACLR 778, 789-91 (Cohen J) (revd on other grounds: O'Brien v Tanning Research Laboratories Inc (1988) 14 NSWLR 601; Tanning Research Laboratories Inc v O'Brien (1990) 169 CLR 332).

[15] See also Corporations Act s 477(1)(a).

[16] See, eg, PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission [2012] HCA 33; (2012) 247 CLR 240, 247 [16] (French CJ, Gummow, Hayne and Crennan JJ).

[18] (1988) 15 NSWLR 348.

[25] [1936] HCA 40; (1936) 55 CLR 499. See also Transport Accident Commission v O'Reilly [1998] VSCA 106; [1999] 2 VR 436, 457 [46] (Ormiston JA); Knight v Hastings [2012] VSCA 315 [15] (Neave JA and Hargrave AJA).